Few things are more devastating to families than the prospect of foreclosure. You own your home, and you love it — it serves you well. Yet, due to unfortunate circumstances, foreclosure may seem imminent.
For local Pennsylvania families facing foreclosure, the stress can be almost unbearable. The foreclosure process can take months or even years, stretching out the pain for longer than anyone wants. Selling your home in Pennsylvania as is could be a viable solution for you to avoid foreclosure.
Fortunately, you have options available here in Pennsylvania — perhaps more options than you realize. There are many strategies that help with foreclosure in Philadelphia; these are legal foreclosure avoidance strategies you can implement to help you resolve your foreclosure issue to get on with your life. We understand that life throws obstacles at us in every direction. You do not know how to avoid certain things from happening to you. A loss of a job can be a hard thing to go through especially if you have a family and you rely on that job to pay bills. Sometimes even the loss of a family member could put you into a bad situation where you are no longer able to afford to pay your mortgage. There are even times when we don’t even intend to fall behind on our bills but one thing leads to another and it just happens. Life is very unexpected. Being prepared is something we should focus on as a homeowner. We want to make sure that no homeowner should have to face foreclosure. Since the pandemic, the foreclosure numbers have gone up to 8 million people who had seen eviction in one week. These are very scary numbers that the United State of America is facing currently.
In this blog post, you’ll read about 3 ways to avoid foreclosure (there are other ways to avoid foreclosure as well). The goal of these strategies is to help you legally and ethically avoid foreclosure and reducing the pain and frustration that you’re facing, while minimizing any long-term financial commitment or burden to you. Not all of these strategies will apply in every situation but you’ll probably be able to find at least one of the three ways that will work for you.
Strategy #1: Work out a deal with your lender
The first strategy is called a “foreclosure workout“. In a foreclosure workout, you’ll sit down with your lender and tell them that you don’t think you can pay your current mortgage obligation but you’d like to figure something out so you can stay in your house and continue to pay your mortgage.
Contrary to popular belief, lenders don’t want to foreclose! They want happy customers who pay their mortgages, so lenders are often willing to work with homeowners to figure out a deal. This might include a temporary reprieve on your mortgage payments, or it might have a catch-up strategy where your outstanding mortgage payments are spread out so you can catch-up and pay them off, or it might include a restructuring of the tremendous amounts that you owe.
Strategy #2. Bankruptcy
Filing for bankruptcy may seem like an extreme measure but it is one of the “tools” in your foreclosure avoidance toolbelt. When you file for bankruptcy, you indicate to all of your creditors that you can no longer pay your bills. Filing for bankruptcy will put a stop to the foreclosure process because all creditors must stop the collection process.
Filing for bankruptcy is a little extreme: it may require you to sell off some of your assets to pay off your creditors. And, a bankruptcy will remain on your credit score for many years, which could impact everything from getting a loan to getting a car… even getting a job. So this shouldn’t be your first line of defense!
Strategy #3. Short sale help for a foreclosure in Philadelphia
A short sale is the third strategy — this is where you sell your home and put the proceeds of the sale toward the amount owing on your mortgage loan. A short sale is preferred for people facing foreclosure because it is proactive, fast, and very effective.
- It’s proactive, which means that you take matters into your own hands (that’s a major stress eliminator because so much of the stress of foreclosure comes from the process being completely out of your control).
- It’s fast — in some cases, you can sell your home in as little as a week! That’s also because it’s local: You can get help for foreclosure in Philadelphia since organizations like Buying Property 215 help people going through short sales.
- It’s very effective because a short sale can completely wipe out (or almost wipe out) the amount owing on your mortgage. If there is any amount left over that is not covered by the sale of the property, you’ll be responsible for it (although you can sometimes work out a deal with your lender).
With a short sale, you still end up with the reality of having to leave your home, but there is a bright side: The impact to your credit is much less (compared to a bankruptcy or a foreclosure), so this is a clever long-term play to give yourself some options.